Software pinpoints fraud clues

Words and phrases point to dirty deeds

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Linguistic software has been used to identify the most common words used in email conversations among employees involved in fraud.

Ernst & Young's Fraud Investigation and Dispute Services Practice has used software it developed with the FBI to pinpoint more than 3,000 examples of specific language and common phrases used in the course of wrongdoing.

The technology can be used to monitor conversations within the 'fraud triangle' – identified by criminologist Donald R Creesey where pressure, rationalisation and opportunity meet.

Unsurprisingly, the most common phrases are "cover up", "write off", "failed investment", "off the books", "nobody will find out" and "grey area". But there are also more mundane expressions, such as "special fees" and "friendly payments", which are common in bribery cases, while fears of getting caught are shown in phrases such as "no inspection" and "do not volunteer information".

The software revealed that common phrases in email conversations where rogue employees are under pressure include "not comfortable", "want no part of this", "don't leave a trail' and "make the number".

Conversations in which employees are rationalising their actions include "told me to", "not hurting anyone", "won't miss it "and "fix it later". 'Opportunity' language uncovered includes "off the books", "off balance sheet transactions" and "pull earnings forward". The software also scans for indications 'out of band' events such as "call my mobile" or "come by my office", suggesting the individual does not want to be overheard.

A spokesperson for the company said it is not making the complete list of words and phrases public, but wants to highlight that targeted analysis of suspect email conversations can save companies millions of pounds.

Dr Rashmi Joshi, director of the practice, said: "eMails, sent in their thousands, between employees, officials, and external parties form the major part of what is mostly positive daily interaction in companies. Despite being the prime means of all conversations, such unstructured data plays almost no role in the compliance efforts of firms.

"Most often such email traffic is only seized upon by regulators or fraud investigators when the damage has been done. Firms are increasingly seeking to proactively search for specific trends and red flags – initially anonymously –but with the potential for investigation where a consistent pattern of potential fraud is flagged."